Tag Archives: social safety net

It’s More Complicated Than That…

H.L. Mencken famously said that for every problem, there’s a solution that’s clear, simple  and wrong.

That’s an observation that has escaped lawmakers and economists for a long time, although in the last several years, many of them have come (grudgingly) to recognize its wisdom.

For a long time, economists predicted human behaviors using a “cost/benefit” framework; incentives were  “profit maximizing” and costs were, well, costs.  Of course, real human beings aren’t so one-dimensional. We don’t behave as the economists predicted, because what constitutes an incentive or disincentive for any particular person cannot be so neatly identified.

It isn’t that we humans don’t act in our own self-interest–we do. It’s just that “self-interest” means different things to different people. Teachers who could make more money in the private sector are rewarded by making a difference in children’s’ lives; lawyers for public-interest organizations forgo substantial monetary rewards but derive immense satisfaction from “doing justice.”

“Value” and “reward” are inescapably subjective.

The incentives to which people respond–what impels someone to work, or to work at this job rather than that one–is often a matter of cultural values and expectations. That’s why the widespread belief that a social safety net creates a “culture of dependency” has always been flawed. People don’t work just for sustenance; they work for cultural acceptance, meaning, self-esteem and personal pride, among other reasons.

A recent cross-national study has recently confirmed the lack of a relationship between the generosity of a country’s social safety net and the diligence with which unemployed people look for work. (It also found that receipt of social benefits didn’t make people happier or more satisfied. Depending on the kindness of strangers simply keeps folks fed and/or housed, not cheerful.)

In other words, feeding people who’ve lost their jobs doesn’t make them stop looking for work, and providing minimal support to those who are down and out doesn’t make us suckers.

It might, however, make us better humans.

Comments

Giving and Taking

The other day, NPR ran a story about a recent study on charitable giving. It turns out that poorer people give a significantly larger percentage of their incomes to  charity than do the wealthy. The report included interviews with people from some especially deprived neighborhoods, and the general import of their responses was empathetic: they knew first-hand how tough things can get, because they had experienced rough times first-hand.

The report made me think of a conversation a few years back with a Canadian colleague. I was curious about the differences in attitudes between Canada and the U.S. when it comes to the social safety net. Here are two countries with immensely similar histories and populations. We watch the same television programs, (mostly) speak the same language, and have remarkably similar popular cultures. Why, then, I asked, are American and Canadian attitudes so different when it comes to the need for programs guaranteeing access to healthcare? Why do the two countries have such different approaches to other social programs?

Her theory was intriguing: Canada is cold.Canada’s early settlers faced an environment that required them to share and co-operate with each other in order to survive. That reality produced a culture that recognizes the necessity and value of interdependence.

I have no idea whether my colleague’s theory is correct, but intuitively, it makes sense. And it helps to explain why people who have so little themselves seem more willing to share what they do have with their neighbors. Hardship reminds us of a truth we sometimes prefer to overlook: we’re all in this thing called life together.

Wealth–not to mention temperate climate–evidently tends to insulate us from that inconvenient truth.

Comments

My Very Own Economic Fantasy

Well, I see from my morning paper that the Congressional GOP is proposing to address the national debt by slashing funding for such frills as home heating assistance and job training. Our compassionate conservatives do remain adamant about protecting wealthy “job creators” from any additional taxes, though.

This shouldn’t surprise anyone; the GOP’s current ideological rigidity has proven impervious to evidence suggesting that keeping tax rates ridiculously low does not spur job creation. As many rich people will confirm, they are more likely to create jobs when poor people have the means to purchase their goods.

As long as those in Congress are playing fantasy economics, let me offer my own fantasy prescription for what ails us.

We have two big problems right now (okay, we have dozens, but I don’t have solutions to all of them): the erosion of America’s already inadequate social safety net, and the lack of jobs, especially for people who don’t have specialized skills. What if we created a true safety net, consisting of a basic income level for those falling below a set poverty level and single payer medical coverage for all of us? And what if, as part of that income support, we required the able-bodied to work for the government? I can think of all kinds of jobs we could create that would improve our local communities: taking care of our parks, assisting teachers in our schools, cleaning streets and alleys, tutoring…the list is endless. At the state and federal level, jobs could include repairing our deteriorated infrastructure, a la FDR.

This should pacify the folks who believe that anyone needing public assistance is by definition a parasite (somehow, their own use of Social Security, Medicare, police and fire, public streets, etc. doesn’t count as government assistance). And it would put people who need work in jobs that need to be done, but aren’t being done because the ideologues have been busy trying to fire every public worker, on the theory that someone working in the public sector teaching our children or protecting our property or overseeing the construction of our highways or administering our tax system doesn’t REALLY do a job–that only work in the private sector “counts.”

We all know this won’t happen. Instead, we’ll just protect the wealthy and screw the unfortunate. Welcome to the brave new America, compliments of Congress.

Comments